Many bloggers and business analysts are predicting the end of retail business as we know it. With the explosion of e-commerce sales, they conjecture that brick-and-mortar stores might come to an end since they have lost their ability to compete. I disagree with this view. There are indeed changes in dynamics in the retail space, but there are also retail business models that compete very well against online stores.
Right now, many traditional retail organizations are going through the redesign of their business models and bringing new solutions to market to attract shoppers and to remain competitive. These changes focus on the retail experience, on store design, on the specialization of their offerings, and on refreshed pricing strategies.
Recently there has been a wave of announcements by retail chains promising shoppers price match guarantees against online prices and more specifically, against Amazon pricing. Best Buy, Wal-Mart, Toys”R”Us and Target recently launched their aggressive price match guarantee programs. In addition to offering special promotions, coupons, ads and sometimes guaranteeing “everyday low prices”, these retailers have to now fully embrace an advanced pricing intelligence platform to make sure that they have real time competitive pricing data that can be accessed easily and that can be implemented at retail locations to respond intelligently to customers’ requests.
Offering price match guarantee presents some important implications:
1) Price intelligence solutions need to be powerful and offer not only outstanding data accuracy, but also comprehensive reviews of all existing sources of competition.
2) Retail locations have to be able to access competitive pricing data in order to respond to customer’s requests, inquiries and complaints. Customers will not wait 24 or 48 hours for an answer. So immediacy of price data confirmation is essential.
3) Depending on the specifications of your price match guarantee, retailers might have to pull historical data very quickly to assess the validity of the customer request in stores.
4) Retail store employees also have to be trained on how to handle customer matching requests. Clear guidelines on how to match and what to match have to be established and deployed in all retail locations. Training is essential in order to stick to the customer price level requests and to avoid sharing unnecessary information.
5) Price match guarantee specifications also have to be clearly communicated at store locations to avoid any customer lash-back Clear signage and communication from employees are important.
These are some important considerations that will ensure success in the design and deployment of a price match guarantee program. Fundamentally, the successful implementation of such a program depends on the quality and speed of your price intelligence solution. Store employees need to have access in real time to the right competitive data. That implies regular searches, real time results, training of employees, definition of clear matching rules and excellent overall preparation by the retailers.
Price match guarantees represent an effective weapon to compete. But, effectiveness is judged by customer satisfaction with the pricing experience in the store and by their willingness to come back to purchase more goods in the future. Brick-and-mortars retailers should not improvise. They should equip themselves with the best-in-class price intelligence solution to give retail employees the confidence to be able to match customer pricing request at the right time and at the right price level while offering a positive experience.
Retail price intelligence is one of the critical technologies that will ensure the sustainability of the brick-and-mortar retail business model. So be bold. Join the data revolution!